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Solyndra's demise sparks stimulus concerns

Sept. 2, 2011 at 11:50 AM   |   Comments

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WASHINGTON, Sept. 2 (UPI) -- The demise of Freemont, Calif., solar panel manufacturer Solyndra, which received a $535 million loan guarantee from the federal government in 2009, calls into question the Obama administration's clean-energy stimulus program.

It was the first company selected under the program, authorized in a 2005 energy law and expanded in the 2009 stimulus law.

In a May 2010 speech at the company President Obama said, "Companies like Solyndra are leading the way toward a brighter and more prosperous future."

Soon after, Solyndra announced it would close a plant, lay off employees and postpone the expansion of its newest facility. It also canceled plans to go public.

On Wednesday, Solyndra announced it was closing its factory and filing for bankruptcy protection.

The company said it would evaluate its options, including selling the business or licensing its technology to other companies.

"This was an unexpected outcome and is most unfortunate," Solyndra Chief Executive Brian Harrison said in a statement. "Regulatory and policy uncertainties" made it impossible to raise capital to quickly rescue the operation, he said.

House Energy and Commerce Committee Chairman Fred Upton, R-Mich., and Oversight and Investigations Subcommittee Chairman Cliff Stearns, R-Fla., noting that the President and administration "repeatedly touted Solyndra and its prospects," have called for additional documents and information from the White House on the loan guarantee.

"It is clear Solyndra was a dubious investment," they said in a joint statement. The company "is just the latest casualty of the Obama administration's failed stimulus."

Just last week the U.S. Department of Energy finalized an $852 million loan guarantee for a California solar project sponsored by NextEra Energy. Earlier in August, the department also finalized a $197 million loan guarantee for solar manufacturing facilities in Oregon and California.

"Solyndra is a black eye" for the administration's clean-energy stimulus program, Matthew A. Feinstein, an analyst at Lux Research, told The New York Times. "And that means bad things for the solar industry in the United States."

Solyndra is the third U.S. solar company to have collapsed last month, following Evergreen Solar of Massachusetts and New York-based SpectraWatt, a spin-off from Intel. And last spring, BP Solar stopped manufacturing at its Frederick, Md., complex.

Combined, the four companies represented nearly one-fifth of the nation's solar panel manufacturing capacity, says renewable energy market analysis firm GTM Research, the Times reports.

The U.S. share of solar panel manufacturing fell from a peak of 43 percent in 1995 to 7 percent last year, says a Department of Energy report.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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